The cytoplasmically-inherited doubled RNA viruses of Saccharomyces cerevisiae are being used as a model to study how viral genomes interact with their hosts. Virions isolated from stationary phase cells grown on ethanol contain an RNA polymerase activity which transcribes full-length single-stranded copies of a unique strand of the viral double-stranded RNA. Hybridization studies have proven that the two species of double-stranded RNA, denoted L and M, are not homologous. These same virions incorporate very little nucleotide into double-stranded RNA. Many of the single-stranded transcripts are released from the viral particles. The "transcriptase" activity is insensitive to added nucleic acids, actinomycin D, and DNase but is severely inhibited by pyrophosphate and ethidium bromide. Mutants defective in viral replication and expression are being studied to determine the physiological role of their apparent transcriptional activity. The replication of the viral RNA is now being studied in vitro. Since many host genes required for M replication but not for L, it is anticipated that different mechanisms of replication may be found for these two RNA species. Transformation of yeast with these viruses or their genomes will also be attempted.